Sanli Environmental Secures Record S\$281 Million LTA Contract, Propelling Order Book to Historic High
Key Financial Milestone: Maiden LTA Project is Largest Single Contract in Company’s History
Sanli Environmental Limited (SGX-Catalist: 1E3) has achieved a major breakthrough by clinching its first-ever project from Singapore’s Land Transport Authority (LTA), together with its joint venture partner China Railway Electrification Engineering Group Co., Ltd. (Singapore Branch). The contract, valued at approximately S\$281.0 million, is not only Sanli’s inaugural LTA deal, but also stands as the largest single contract ever secured by the Group.
Key Highlights Investors Must Note
- Record-Setting Order Book: With the addition of this LTA project, Sanli’s order book surges to an all-time high of S\$614.9 million, underscoring robust future revenue visibility.
- Scope of Work: The project involves the supply and installation of electrical services for Cross Island Line Phase 1 and the Cross Island Line – Punggol Extension.
- Joint Venture Strength: The partnership with China Railway brings together complementary technical expertise and proven execution experience, expected to enhance project delivery and risk management.
- Financial Impact: The contract is anticipated to have a positive impact on both net tangible assets and earnings per share throughout its 5-year duration, barring unforeseen circumstances.
- Strategic Significance: This win signals Sanli’s capability to bid for and execute large-scale, complex public sector infrastructure projects, potentially opening the door to more high-value contracts in the future.
Statements from Management
CEO and Executive Director, Mr. Sim Hock Heng, described the contract as a “defining milestone in Sanli’s growth journey.” He emphasized that the award reflects the LTA’s trust in Sanli’s capabilities and track record, and highlighted the opportunity to collaborate with an established industry partner. Mr. Sim reaffirmed Sanli’s commitment to pursue further large-scale projects in alignment with its growth strategy, with an aim to deliver new value to customers while expanding the order book.
About Sanli Environmental Limited
Established in 2006 and listed on the SGX-Catalist in 2017, Sanli Environmental is a specialist in the design, supply, delivery, installation, commissioning, maintenance, repair, and overhaul of mechanical and electrical equipment across water and waste management infrastructure. Its diversified skillset spans wastewater treatment plants, water reclamation plants, NEWater plants, waterworks, reservoirs, pumping stations, and incineration plants. Sanli’s ongoing diversification strategy is focused on developing multiple revenue streams and strengthening business resiliency, positioning the Group to capitalize on new opportunities in the environmental sector.
Investor Takeaways & Potential Share Price Drivers
- Significant Revenue Upside: The S\$281 million contract will be recognized over 5 years, providing stable, recurring revenue.
- Enhanced Earnings Visibility: Positive impact on EPS and NTA over the contract period could drive investor confidence and share price appreciation.
- Strong Public Sector Credentials: The first LTA project win may pave the way for additional high-value government contracts, strengthening Sanli’s market positioning and profile.
- Order Book Momentum: The record order book of S\$614.9 million is a key positive for long-term growth and shareholder value.
Conclusion
The award of Sanli’s largest-ever contract, and its maiden LTA project, marks a pivotal point in the Group’s expansion strategy. Investors should closely monitor the company for further contract wins and updates on project execution, as these developments are likely to be highly price sensitive and could catalyze significant share price movement.
Disclaimer: This article is for informational purposes only and does not constitute investment advice or a recommendation to buy or sell any securities. Investors should do their own due diligence and consult a licensed financial advisor before making any investment decisions. The author and publisher accept no liability for any losses incurred based on this information.
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